Chapter 8, Problem 8.31P

To determine

Introduction:

The paid up capital for any company are always recorded in the par value, and whatever extra received over and above the par value is the premium payment which is shown under the additional paid up capital below the paid up capital heading.

The dividend for preference shareholders are always fixed and are paid on the basis of fixed percentage multiplied by the par value of capital. However, the cash dividend for common stock is dependent upon the earnings and decided by the boards.

Requirement-a:

To Calculate:

The total amount of dividend requirement on preferred stock

To determine

Introduction:

The paid up capital for any company are always recorded in the par value, and whatever extra received over and above the par value is the premium payment which is shown under the additional paid up capital below the paid up capital heading.

The dividend for preference shareholders are always fixed and are paid on the basis of fixed percentage multiplied by the par value of capital. However, the cash dividend for common stock is dependent upon the earnings and decided by the boards.

Requirement-b:

To Calculate:

The total amount of preferred stock on balance sheet

To determine

Introduction:

The paid up capital for any company are always recorded in the par value, and whatever extra received over and above the par value is the premium payment which is shown under the additional paid up capital below the paid up capital heading.

The dividend for preference shareholders are always fixed and are paid on the basis of fixed percentage multiplied by the par value of capital. However, the cash dividend for common stock is dependent upon the earnings and decided by the boards.

Requirement-c:

To Calculate:

The number of common shares issued and outstanding

To determine

Introduction:

The paid up capital for any company are always recorded in the par value, and whatever extra received over and above the par value is the premium payment which is shown under the additional paid up capital below the paid up capital heading.

The dividend for preference shareholders are always fixed and are paid on the basis of fixed percentage multiplied by the par value of capital. However, the cash dividend for common stock is dependent upon the earnings and decided by the boards.

Requirement-d:

To Calculate:

The number of shares sold and selling price

To determine

Introduction:

The paid up capital for any company are always recorded in the par value, and whatever extra received over and above the par value is the premium payment which is shown under the additional paid up capital below the paid up capital heading.

The dividend for preference shareholders are always fixed and are paid on the basis of fixed percentage multiplied by the par value of capital. However, the cash dividend for common stock is dependent upon the earnings and decided by the boards.

Requirement-e:

To Indicate:

The transaction for additional paid in capital

To determine

Introduction:

The paid up capital for any company are always recorded in the par value, and whatever extra received over and above the par value is the premium payment which is shown under the additional paid up capital below the paid up capital heading.

The dividend for preference shareholders are always fixed and are paid on the basis of fixed percentage multiplied by the par value of capital. However, the cash dividend for common stock is dependent upon the earnings and decided by the boards.

Requirement-f:

To Calculate:

The amount of common dividend